HBA-ATS, NLM H.B. 2284 76(R)BILL ANALYSIS Office of House Bill AnalysisH.B. 2284 By: Averitt Financial Institutions 6/7/1999 Enrolled BACKGROUND AND PURPOSE Article 21.57 (Withdrawals for Premium Payments, Prohibited Practices), Insurance Code, requires an insurance company to give a 30-day advance notice of a proposed increase in premiums if the insurer withdraws the premiums from a traditional bank account. An insurer is required to provide consumers of traditional accounts with a prepaid postage form with which the consumer may dispute the increase. The consumer must provide the insurer with any disputes within five days of the effective date of the proposed premium increase. Prior to the 76th Legislature, premiums withdrawn from escrow accounts, as opposed to traditional bank accounts, were subject to a 60-day notification from the insurer. Escrow account holders were required to dispute a premium increase within 30 days of the effective date. H.B. 2284 subjects escrow accounts to the same timetable as a traditional bank account regarding insurer notification and consumer disputes for proposed premium increases by repealing Article 21.57(d), which stated that for the purposes of a policy insuring property under a deed of trust with premiums paid from an escrow account, notification by the insurer was prohibited from being later than the 60th day before the effective date of the increase in premium, and written objection to the increase was to be provided at least 30 days before the date the increase took effect. RULEMAKING AUTHORITY It is the opinion of the Office of House Bill Analysis that this bill does not expressly delegate any additional rulemaking authority to a state officer, department, agency, or institution. SECTION BY SECTION ANALYSIS SECTION 1. Amends Article 21.57(b), Insurance Code, to subject a person's escrow account to the existing provisions of this section, regarding automatic premium payments to an insurer through withdrawal of funds from the account. SECTION 2. Repealer: Article 21.57(d). Subsection (d) states that for the purposes of a policy insuring property under a deed of trust with premiums paid from an escrow account, notification by the insurer may not be later than the 60th day before the effective date of the increase in premium, and written objection to the increase must be at least 30 days before the date the increase takes effect. SECTION 3. Effective date: September 1, 1999. SECTION 4. Emergency clause.